The first tipoff to trouble came from a D.C. hotel, where a staff member discovered computer equipment, cellphones and documents left behind in an unoccupied hotel room.
The call to police from the hotel led to a lengthy investigation that uncovered an international money-laundering network that authorities say duped at least 170 people and six companies out of millions of dollars.
Federal prosecutors on Wednesday announced the arrests of more than a dozen people in three states and four countries, after indictments were unsealed in federal court in Washington in four cases involving phony online car sales and the infiltration of corporate email systems.
Law enforcement officials said the conspiracy began in 2010 with bogus online advertisements for cars, motorcycles and boats on websites such as eBay.com and Cars.com. Buyers were lured with photos and highly detailed descriptions into transferring money, for example, to purchase Mercedes-Benz vehicles that they never received, according to court filings.
In all, the defendants are accused of stealing more than $3 million from the buyers, who were primarily located in the United States.
The men arrested on Wednesday, who are mostly from Hungary, set up shop in two D.C. hotels and used counterfeit passports and driver’s licenses to open more than 70 bank accounts, set up UPS Store mailboxes and establish companies, according to court papers filed in U.S. District Court in the District.
These “money mules” in Washington and Boston, among other U.S. cities, quickly transferred money from the fake online sales to accounts in Hong Kong and China, among other locations.
Andrew Vale, assistant director in charge of the FBI’s Washington Field Office, said that the eight defendants charged in the car-sale conspiracy were “sophisticated, well-connected and continually honed their techniques to exploit their victims.”
In a separate indictment also unsealed Wednesday, prosecutors say another group of defendants stole more than $10 million from a half-dozen companies based in Europe by impersonating company managers in spoof email messages.
Authorities say the defendants – from Israel, Romania, Germany and Serbia – used phony messages appearing to be from high-level company executives to target midlevel employees with access to company finances. The messages tricked employees into making wire transfers to familiar-sounding bank accounts.
The conspirators created fake emails by purchasing domain names from registrars located in the United States, according to the indictment. They operated primarily from “safe houses” in several European cities.
Vale said the accused used “persuasion and pressure to manipulate” employees into believing they were being trusted to perform critical company transactions. In some cases, employees were told they were working on a “secret corporate acquisition,” according to the indictment.
Since January 2015, the FBI has tracked a rapid increase in financial losses by businesses traced to similar scams.
At a time when so much business is conducted electronically, law enforcement officials said, the case was something of a cautionary tale to always follow up on the phone or in person after an email contact.